What is Form 10C used for in PF? : When leaving a job, you can either have the balance of the employee provident fund (EPF) transferred to the new employer, or withdraw the balance from the PF. But, PF is only one part of the employee retirement fund, the other part is the Employee Retirement System (EPS) which is intended for retirement during retirement years. Besides the EPF, there are funds in the EPS that the employee can either withdraw or transfer to the new employer. Carrying over the EPS money is possible thanks to what is called the “plan certificate”.
Both options – Withdrawing EPS money or opting for a plan certificate are available in Form 10C. “Before reaching the age of 50, a member can either opt out or apply for a program certificate and one can take advantage of a program certificate, then become a regular member of PSE again until the age of. 58 years old, “said Prashant Singh, Business Manager – Payroll Compliance and Outsourcing, TeamLease Services.
One can use the composite complaint form (Aadhaar / Non-Aadhaar) that EPFO currently uses for such cases. If you opt for the Scheme Certificate, EPFO will keep a record of it and calculate the number of years of service accordingly. Therefore, after quitting a job, if you want to withdraw EPS money or go for a scheme certificate, make sure you have completed Form 10C.
According to Singh, the following claims can be made using the PF 10C form:
- A member who left employment before the end of 10 years of service can use Form 10C to request the withdrawal benefit amount
- A member who left employment before the end of 10 years of service who is not eligible for a pension, must apply in Form 10C to obtain the withdrawal benefit amount
- A member, who has completed 10 years of service on the date of leaving service and has not reached the age of 50 on the date of filing this application can use the form to obtain a plan certificate
- A member who has reached the age of 50 or over but under 58 and does not want a reduced pension can use the form to get a scheme certificate, but if he wants to get a reduced pension he can do it by applying via form 10D
- Finally, Form 10C can be used by family members in the case of a deceased member who died after reaching the age of 58 but before completing 10 years of qualifying service.
As an employee, 12 percent of the basic salary goes to the EPF while an equal contribution is paid by the employer. However, not all of the employer’s contribution goes to EPF – only one part goes while the other part goes to EPS.
Calculation of EPS
Each month, from the employer’s contribution, 8.33 percent of the basic salary (up to Rs 15,000) goes to EPS and the rest to EPF. Thus, whatever the basic salary, Rs 1,250 (15,000 * 8.33%) enters the PSE. Simply put, in one year, Rs 15,000 (Rs 1,250 * 12) goes into BPA and in 5 years the employer’s contribution to BPA will total Rs 75,000.
EPS withdrawal before 10 years
After ten years of service, the possibility of withdrawing EPS money ends. In the event of a change of job, it is mandatory to go through the Scheme Certificate. But, if you have not completed 10 years of service and want to withdraw EPS money, you can do so by filling out Form 10C.
PSE after 58 years
After 10 years of service and 50 years, you can still get a pension, but at a reduced rate. Once you retire after age 58, your regular and full lifetime pension will begin.
How much retirement
The amount of EPS money that can be withdrawn before the end of the 10 years will be based on a certain factor defined by the EPFO. For example, after 5 years, one is eligible to obtain 5.02 times the proportion of the base salary put in the plan, that is to say Rs 75,300 (Rs 15,000 * 5.02)
EPS pension formula
Upon retirement after 58 years, the amount of the pension will depend on the pension formula, which is
(Pensionable salary multiplied by period of service) / 70.
The salary for calculating the pension is capped at Rs 15,000 and the maximum period of service can be 35 years. The maximum pension can therefore be Rs 7,500 per month.
Whenever you leave a job, be sure to download Form 10C and submit it to your employer after completing it. It can also be submitted online. The instructions in the EPS 10C form will give you the option of choosing between withdrawing EPS money or opting for a plan certificate, depending on your period of service up to the date.